A sturdy pickup in the Indian smartphone market is expected in the third quarter of 2017. This is motivated by improved sentiments, and inventory builds before the upcoming festive season, stated a report by JP Morgan.
Reports established that demand was low in the second quarter (April-June) 2017 compared to the previous year. This was due to the lack of clarity around the GST implementation, which was responsible behind the “postponed the usual inventory build”. Also, one of the reasons was on account of crawling transformation of feature phone users into smartphone users. “We believe that sentiment has improved in early July and the third quarter of 2017 should see a strong pickup with inventory builds and preparation for the peak sell through the season in late third quarter and early fourth quarter,” the report stated.
Some More Statistics
The report added that the July-September bit may witness a 25-30 percent sequential growth in smartphone units. This comes to a seven percent year-on-year growth. Smartphones include 45 percent of the total handsets sold in the April-June quarter. This range may remain the same. However, in the short-term, it can be affected by the launch of the Rs 1,500 Reliance JioPhone.
Just previous month, Mukesh Ambani announced Reliance’s new feature phone, JioPhone. It will offer life-long free voice calls. Moreover, it will also provide 4G data streaming at an “effective price of zero”. The phone is aiming for 50 crore feature phone users in the country. It will be available for pre-booking from August 24 on the payment of a refundable security deposit of INR 1,500.
“This is likely to appeal heavily to current feature phone users, who are primarily on the 2G network. This may slow the migration from feature phone to smartphones for some users in the near term…,” the JP Morgan report added.